ADB's Support for Environmental Sustainability
Asia and the Pacific face serious environmental challenges due to rapid industrialization, urbanization and expanding agricultural production that constrain the economic prosperity and well-being of the region. COVID-19 may exacerbate these trends further as lockdowns have led to an increase in illegal hunting, logging, and animal trafficking—all of which increase the risk of another zoonic disease pandemic. To address these challenges, ADB works with its developing member countries and private sector clients on integrating environmental sustainability into national development priorities and corporate sustainability goals, while financing critical programs and projects. ADB’s environment work is guided by Strategy 2030, especially the Operational Plan for Priority 3 on “Tackling Climate Change, Building Climate and Disaster Resilience, and Enhancing Environmental Sustainability.”
This includes three interlinked sub-pillars:
- Increasing climate change mitigation
- Building climate and disaster resilience
- Enhancing environmental sustainability
Under the third pillar, ADB focuses on
Air and water pollution management
Natural capital and healthy oceans
Water–food–energy security nexus
Cross-cutting issues (e.g., governance, green business, gender)
Environmental sustainability is required for economic growth and poverty reduction in Asia and the Pacific. ADB supports its developing member countries in improving environmental management, investing in natural capital conservation and restoration, improving environmental governance, and ensuring that projects contribute to water, energy, and food security. To increase women’s empowerment and build their resilience to climate change, disaster impacts and environmental degradation, ADB provides greater access to technologies and finance, support for diverse livelihoods, and increased participation in community-led solutions, among others. Through its Environment Thematic Group, ADB supports investments and technical assistance to support ocean health, air quality, natural capital and biodiversity, and green business models and market-based instruments.
At its 2019 annual meeting, ADB launched the ADB Action Plan for Healthy Oceans and Sustainable Blue Economies, with the commitment to scale up investments and technical assistance to $5 billion between 2019-2024, including co-finance. The action plan has three focus areas, which are interconnected. These are: (1) ecosystem and natural resources management; (2) pollution control; and (3) sustainable coastal and marine development. ADB has created an Ocean Financing Initiative to increase the amount and efficacy of financial capital for ocean health and sustainable blue economies. In addition, ADB will create an Ocean Partnership Facility to pool grant funding, concessional debt and equity, and knowledge and technical expertise from ADB and other public and private sector development and financing partners.
The following two initial flagship programs for ocean health have been developed based on ADB's current capacity and areas of expertise and country demand. A third program on greening major ports is in development.
- From Source to Sea: Towards a Plastic Free Ocean
- Building Resilience: Investing in Critical Coastal Ecosystems and Livelihoods
ADB supports improving air quality through knowledge products and events, investment projects and technical assistance. The following are examples of activities focused specifically on air quality improvement:
- PRC: ADB has invested $2.15 billion since 2015 through a series of loans to support policy reforms to improve air quality, the establishment of a green financing platform, deployment of advanced technologies, and switching to cleaner fuels.
- Mongolia: ADB has invested $291.3 million through two policy-based loans to support the government’s National Program for Reducing Air and Environmental Pollution through policy reforms and planning; and replacing 80,000 tons of raw coal with cleaner semi-coke briquettes.
- Central Asia region: An ADB regional technical assistance project provides support to Kazakhstan, Mongolia and the PRC for low carbon growth through planning, capacity building and data management.
- Regional: An ADB regional technical assistance project strengthens knowledge and actions for air quality improvement in seven cities in the following five countries: Bangladesh, Mongolia, Pakistan, Philippines and Vietnam. The main output is to develop city-level clean air action plans to guide future management and investment.
Natural Capital and Biodiversity
ADB supports its developing member countries to preserve and protect their natural capital and biodiversity to support economic growth and maintain and improve the well-being of people, particularly women and other vulnerable groups. Project support includes a range of activities from protected areas management, watershed protection, habitat restoration, biodiversity conservation, sustainable livelihoods, and support for financing mechanisms such as eco-compensation schemes. ADB also provides knowledge and technical support for integrating biodiversity-sensitive design and eco-sensitive principles into projects and infrastructure planning and design. The Green Infrastructure Design for Transport Projects publication provides guidance on typical ecological impacts from roads and railways and eco-sensitive design principles and options for designing new and retrofitting existing transport infrastructure. This work links to and supports the G20 Principles for Quality Infrastructure Investment, which aim to maximize the positive economic, environmental, social, and development impact of infrastructure.
Water–Food–Energy Security Nexus
ADB’s Strategy 2030 recognizes the interconnectivity or nexus between water, energy, and food security, and that interventions in one sector can have consequences for another. Public policies are needed to help decision makers allocate and rationally manage water use across the food, energy, industrial, and municipal spectrum, while also ensuring environmental sustainability and reducing GHG emissions. ADB has been encouraging nexus considerations in sector operations, for example through its country water assessments and supporting integrated water resources management. Raising awareness of these interconnections and providing guidance on how to address interdependencies in ADB operations is part of its knowledge support agenda, examining both the possible win-win benefits of taking a more cross-sectoral perspective and the need to deal with trade-offs where necessary. See ADB’s Focus on Water page for more information.
Green Business Models and Market-Based Instruments
ADB conducts technical studies on the use of market-based instruments to stimulate green business development in the region. Green business supports investments in key environmental sectors, such as solid waste management, air quality management, wastewater and sanitation, and natural capital. Market-based instruments can reduce pollution and improve resource efficiency through incentives, behavior change, innovation, and public awareness of corporate environmental performance. Environmental taxes and tradeable permit markets also create opportunities for additional sources of government revenues, which can be used to address environmental needs.
Examples of market-based instruments include:
- Air Quality: Fuel taxes; feed-in tariffs; phaseout of fossil fuel subsidies; procurement auctions; emission trading schemes
- Water Quality and Resource Management: Effluent and nutrient taxes; green infrastructure subsidies; payment for ecosystem services
- Waste Management: Pay-As-You-Throw schemes; extended producer responsibility; deposit-refund schemes